Luxair pegs future hopes on new fleet

Luxair could begin replacing its current fleet within the next three years, airline board chairman Paul Helminger revealed at a British Chamber of Commerce lunch on Friday.

27.09.2013

Luxair could begin replacing its current fleet within the next three years, airline board chairman Paul Helminger revealed at a British Chamber of Commerce lunch on Friday.

During his speech, entitled “The Future of Luxembourg Aviation”, Mr Helminger said that refleeting was critical for Findel airport to achieve its full capacity and for Luxair's future success.

“We're starting to think about it (refleeting) now. At the moment we cannot get into that exercise, it's something like 2016-17. We could be even more successful if we had the capacity,” he said.

The chairman said that the fleet would develop around two of the airline's existing aircraft: the Boeing 737 for long-distance flights and Bombardier Q400 for short distances. The current six Embraer ERJ-145s would therefore be replaced.

Mr Helminger outlined that both Luxair and Cargolux, for which he also serves as board chairman, are not using the airport to its full capacity.

He explained that this year the airport was expecting to cross the threshold of 2 million passengers, when it has capacity for 3 million. Meanwhile, regarding freight he said the airport was capable of handling upwards of one million tonnes of freight. “We're currently between 600,000 and 700,000 tonnes,” he said.

Mr Helminger went on to reveal that the costs of Luxair remained well above those of its major rivals. Transporting a passenger costs the firm 18 euro cents per kilometer, compared with 12.15 cents at Lufthansa and 4.6 cents at Ryanair.

“Somewhere we've got to close that gap if we want to continue successfully flying,” he said.

He said that the two firms had taken steps to reduce costs and increase yield, including more aggressive pricing on passenger flights, opening routes to locations served by low-cost airlines, the purchase of fuel-efficient 747 -8Fs at Cargolux, concentrating on specific markets such as pharmaceuticals and synergising the support services between the two firms, among others.

The Luxembourg government is currently in negotiations with potential shareholders to sell its 35 percent stake in the firm. While Mr Helminger did not shed any light on how or when these talks could conclude, he outlined his expectations for the new partner.

“A sovereign partner. Someone with strategic vision, who matches our vision of Luxembourg as a logistics hub in the centre of Europe, provided he was far enough away that he would not be in competition. That would be an ideal candidate,” he said.

The next British Chamber of Commerce event will be the personal tax lunch on November 22. www.bcc.lu